Stockbrokers and advisers have received over $186 million in ‘stamping fees’ over the past five years, according to the Australian Securities and Investments Commission (ASIC).
The figure has been revealed in an answer to a question on notice form the Parliamentary Joint Committee on Corporations and Financial Services, albeit that ASIC said it was not possible to quantify the total amount of remuneration paid in reliance on the stamping fee exemption.
“We estimate that over the five years to end 2019, stockbrokers and other financial advisers have earned over $186 million in ‘stamping fees’, or what public offer documents refer to as broker or adviser fees, from more than $14 billion of initial capital that has been raised by [listed investment companies] LICs and [listed investment trusts] LITs,” ASIC said.
“This amount does not include secondary capital raised in the form of secondary equity offers, entitlement rights and attached company options. Further, significant joint lead manager (JLM) or arranging ‘success’ fees are often paid if the IPO is successful,” it said.
“A portion of these payments are made in reliance on the stamping fee exemption and could run into the millions of dollars for a single stockbroking or financial advice firm.”
“We estimate that over the five years to end 2019, the combination of stamping fees and JLM and arranger fees, firms involved in the raisings could have earned well in excess of $330 million.”